Cerebras IPO is Thursday and I'm out at $160

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Summary

Post analyzes Cerebras’ upcoming IPO at a raised price range of $150–160, comparing its valuation multiples, margins, and customer concentration unfavorably against Nvidia, Broadcom, and AMD.
Author’s thesis: the IPO is overpriced at $160 (67x trailing P/S, 43% gross margins, three major customers) and the upside does not justify the risk, despite impressive tech and $24.6B in contracts.
Quality assessment: well-researched DD with specific data, comparables, and a clear bearish conclusion, though based on forward assumptions about OpenAI’s financial health.

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u/charon-the-boatman Reddit r/stocks

Cerebras’ trailing P/S of 67x far exceeds Nvidia’s 24x, Broadcom’s 31x, and AMD’s 9x; its 43% gross margin is the lowest among peers; customer base is concentrated in just three names (OpenAI, AWS, Meta). These fundamental weaknesses are being masked by IPO hype (20x oversubscription, three price raises in a week), creating a likely overvaluation that will correct after the initial pop. Short Cerebras after the expected first-day spike, betting that the market will eventually price in the poor margins, high multiple, and dependency on cash‑burning OpenAI. OpenAI’s 2026 revenue could hit $1.1B+, dropping forward P/S to ~30x; the float is tiny so short squeezes are possible; the tech is genuinely superior for inference.

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